I never cared much for Space Mountain at Disney. My stomach lining was more agreeable with Thunder Mountain. The Whipsawing (like Space Mountain) we have experienced in the market of late is very uncomfortable. I get that. We all know that we should never sell at the bottom or buy at the top, but that is exactly what fear will lead us to do, so I want to encourage you to not be discouraged, to stay calm, and not make decisions that you may come to regret later.
We are all asking a lot of questions. How long is this going to last? Can the market go down more from here? What should we do? Are we going to be ok? Will there be a recession? Are we in a bear market? Will this inflation ever end? What will be the impact of rising interest rates?
I don’t know the answers to all those questions. What I can do is share some of what I learned when I attended Advisor Group’s Wealth Management Symposium last week. In all the sessions about the economy and markets, I found the speakers to be overwhelmingly optimistic. There was no conviction that recession is imminent or inevitable. Inflation is expected to be lower by year end – not to the Fed’s 2% target for inflation, but lower than where we are today. Interest rates are going higher, which initially hurts bonds as an asset class, but as I have heard from many money managers, it will also make bonds more relevant as an asset class longer term. The cash in your bank account will start to pay higher rates. The market is expected to continue to be volatile but will likely still be higher by year end. It’s impossible to relay all the information I heard, but I am sharing a couple of resources from Ladenburg Thalmann Asset Management that you may find of interest and expresses similar sentiment.
Please check out the Ladenburg Market View Weekly as of May 6, 2022 at http://assetmanagement.ltam.com/public/stayinformed/LadenburgMarketViewWeekly(WeeklyPieceforClients)05.6.2022.pdf
Also, I am including a link to a special podcast that was done last week. It is a May 5 Special Edition with Special Guest: Jeffrey Schulze, CFA. https://weeklymarketimpact.libsyn.com/may-5-market-impact-special-edition
What we do NOT know:
- How long this will last or when the markets will recover.
- When the next 30% gain or 30% decline will commence.
What we do know:
- The economy had been showing tremendous strength before this current panic.
- No person, investment adviser or government can consistently predict the future.
- Most of humanity has a massive internal motivation to innovate, grow, work, and succeed.
- Good times in this world come and go, but the spirit of the human soul continues.
- The past never guarantees the future.
What should you do?
- If you have been implementing the comprehensive financial planning principles we have historically, currently, and continually advocate, our advice is to do exactly what you were doing BEFORE this current panic showed up.
- If you need cash, let us know and we will help you figure out the best place to take it from.
- If your long-term financial goals have not changed, we do not recommend changing your portfolio (from our perspective, the word “portfolio” includes the entirety of your financial resources: all accounts and products you own).
- If you have some additional cash, we should talk about deploying it along the way.
- If you still find yourself home more than usual because of “social distancing”, shut off your electronic devices, spend time in real conversation with your family. Cook as a family. Make up some silly games and have family “Olympics.” Do devotions as a family. Make some memories.
- If you live alone, “partner” with someone else who lives alone with a commitment to check on each other frequently with a phone call or a text. A phone call is better, because it does a heart good to hear the sound of another human besides the voice that comes from your TV set.
- Don’t hoard.
- Don’t spend hours fixated on the news. Limit your time on the TV. If you miss the evening news – trust me – they will be covering the same thing first thing the next morning.
- Live with hope, faith, and gratitude. Living with an attitude of gratitude will go a long way in keeping you healthy.
- Laugh. A good belly laugh is great for reducing stress.
- Remember, this too shall pass. We will get through this.
If you have questions or concerns, PLEASE call me – 954-302-6321, or text me – 954-880-3410. My assistant, Danielle, can be reached at 954-302-6324. Our office is on a hybrid work schedule – in the office 2 days per week and remote 3 days per week. As a result, we are doing limited face-to face (actually, “mask-to mask”) meetings in the office. We can set up a zoom meeting so we can be “face-to-face” from wherever we are. If we don’t pick up your call, please leave a message. We promise to return your call as soon as possible.
As I have said many times before, there is never a bad time to evaluate your portfolio. If things have changed in your life, a change may be called for. If your risk tolerance, time horizon, and overall goals remain the same, staying the course may be appropriate. Bottom line, this is not a time for panic.
As always, please remember, you only have 168 hours to live your life this and every week. Spend your 168 hours doing the things that only you can do – the things that are really important to you. Spend more time with the people you love. (And tell them you love them, too.) Do activities to help improve your health and fitness and spiritual life. Engage in activities that give joy to others (and see how much you benefit, too). Laugh out loud. Express your creativity. Play a game. Take a friend to lunch, even if it is via Zoom. Donate your time to a worthy charity. Change your routine. Live a high-performance life!